The new financial rules of the United States has lead to an agreement between the Senators and Representatives of Congress. Since the regulations of 1933 and 1934 following the stock market crash of 1929, is a fundamental transformation of the financial landscape that we will see. At the inability of financial elf-regulation, the U.S. legislator has developed a regulation of about 2000 pages that concern all aspects of finance.
The fact that there is a political agreement between Democrats and Republicans on this project is remarkable in itself: Wall Street was generally almost unqualified support among Republicans. It is public opinion that made the difference. The abuses of funds and misuse of ones stock picks has indeed had a real effect on the average American: Increased levels of funding for their homes, property market declines, loss of housing, massive job. Many of them have more been able to financial studies of their children.
Returned from China where I just spent a week I would like to share some observations about the situation that has developed since the tsunami of March 11, colored by my presence in Asia and my understanding of Japan.
Lives in Japan has always bent bow: is the magnitude of the earthquake, tsunami monitoring and finally managed to damage caused to the plant in Fukushima that hit. But the Japanese know that they live on a tectonic plate, and Tokyo was hardly damaged. Cities are built to withstand such shocks. On Monday, the Japanese were working. At no time did they panicked, even when millions of people of Tokyo had to walk home in several hours. It’s absolutely remarkable.
According to information from the Centre for Economics and Business Research (CEBR) property prices in the UK are due to rise in 2010 driven by low borrowing costs and the shortage of homes. Property values are due to rise by five percent and mortgage costs will cheapen as the Bank of England retains a its record low 0.5 percent key interest rate. CEBR have reduced their property price forecast from 6 percent after the tax on home purchases rose and cold weather damped demand for property. Average mortgage interest rates are expected to drop by around one percent by the start of 2011.
US based billionaire investor Warren Buffett, has backed Bank of England Governor Mervyn Jones previous comments by stating that said he doesn’t envy the winner of the UK general election, who will be faced with the need to make "politically very unpopular" decisions to cut the deficit. Speaking after the annual shareholder meeting of Berkshire Hathaway before a crowd of 40,000 , Mr Buffett warned the next occupant of No 10 to fear the bond market, which could turn against the UK if public spending is not brought back into balance over the long term.
The International Monetary Fund (IMF) has stated that governments must act to curb the increasing power of banks in the aftermath of the financial crisis. The IMF has called for cooperation from governments to set out future financial regulatory reform agenda, whilst stressing that some of the "too-big-to-fail" institutions had been made even stronger by the financial crisis. The IMF went on to warn that the large government financed deficits run-up during the financial crisis could pose a risk of starting a second credit crunch.
Proposals from the IMF include imposing two new taxes on banks in order to raise funds to pay for potential future bailouts and to penalise excessive profit-making. UK Chancellor Alistair Darling was reported as having welcomed the proposal:
President George W. Bush signed into law an economic stimulus package that is aimed at staving off a recession by offering tax rebates and incentives to businesses to invest, Reuters reports:
"Here are some details of the plan:
* The total package is worth about $168 billion over two years, roughly 1 percent of U.S. economic output, and will add directly to the U.S. federal deficit."